Opportunities in telecom sector fall

HA NOI (VNS)— Growth opportunities in Viet Nam's telecoms sector appear to be diminishing due to market saturation and the dominance of State-owned entities in a highly competitive landscape, according to a recent report by the Business Monitor International (BMI).

Viet Nam fell to the 16th position on BMI's latest Asia Pacific Telecoms Risk/Reward Ratings with a score of 42.4.

The London-based firm believes that operators in Viet Nam should re-evaluate their strategy and focus on trying to leverage on their existing base of subscribers to generate strong revenues.

It suggested the Government increase its efforts to promote a level playing field and boost ailing foreign-investor confidence.

Data from the General Statistics Office indicate that the Vietnamese mobile industry has been experiencing weak growth, which BMI believes will persist given the high mobile penetration rate.

The company said it envisaged 132.3 million subscribers by the end of 2016, representing a penetration rate of 141.9 per cent.

It said the slow growth in the mobile sector could explain the stability experienced by Viet Nam's fixed-line market.

BMI predicted that the number of fixed-line subscribers would gradually decline to 13 million by 2016, down from 14.7 million this year.

It also forecast that there will be 5.9 million fixed broadband subscribers in Viet Nam at the end of 2016. The sector is expected to experience significant threats from mobile broadband solutions.

According to a recent report by the Ministry of Information and Communication (MIC), Viet Nam's ICT sector earned a revenue of US$13.7 billion in 2011, registering a year-on-year increase of 79 per cent. — VNS